You're making a big decision. What biases are you bringing to the table?

Decision-making biases are like shortcuts our brains take that can sometimes lead to errors. More over, each bias can affect decisions differently.

I understand the importance of making informed decisions that benefit my team and organization. However, I am also aware of the potential influence of confirmation bias, which can lead me to favor information that confirms my existing beliefs while disregarding contradictory evidence. To counter this bias, I will actively seek out different perspectives and sources of information, challenge my own assumptions, and be open to feedback and criticism. I will also strive to consider alternative scenarios and outcomes, and adjust my expectations and goals based on new information and feedback.

I agree, confirmation bias is common and I think there is always a natural tendency to lean towards our own experiences. To avoid this we need to ask questions (even the uncomfortable ones) and encourage others around the table to share. Engagement, listening and consideration of the many experiences, will lead to an improved, inclusive outcome.

Confirmation bias can strongly impact decision-making by causing you to favor information that confirms your existing beliefs or preconceptions, leading to flawed decisions. Let’s say it is like wearing blinders in decision-making. Imagine a business team favoring data that supports their product idea, ignoring signs that it might not work. This bias can lead to bad decisions because they miss out on crucial info. To mitigate its influence, it's crucial to actively seek out diverse opinions and consider alternative viewpoints during decision-making processes.

With 18 years of experience in banking, and risk management i have learned to always do my homework and research and never go for decision making based on first information. Confirmation bias will result in good decision making. no particular story in mind, but said again, my banking experience and working with the high management tought me to collect as much info as possible prior to any decision making. It's important to note that even these biases can have negative consequences if they are not recognized and managed appropriately. The goal should be to strive for objective decision-making by being aware of our biases and actively seeking diverse perspectives and evidence to counterbalance them.

I have fallen into this pit severally until I started challenging the information.... Question like where did this come from? What are the other sources of information we are yet to consider? I try to benchmark, even though this will look like a time wasting strategy but I have found this to be very useful

Never rely on the first piece of information. Most of the time it is there to distract you. It might be in your favor or not but when you don't rely on the first hand information, it will give you an ability to guage what's the best alternative, how many options you may have before picking the only one and your decision making skills may improve. Always think about the pros and cons of anything that you have come across while making a decision. Optimism and Pessimism should be in balance

Anchoring bias is when people rely too heavily on the first piece of information they get (the "anchor") when making decisions. In business, let's say someone throws out a crazy high price at the start of a negotiation – that number becomes the anchor. Even if it's way too much, it can mess with your judgment, making you settle higher than you should. For instance, in negotiations, stating a high price early may influence the final agreement. To tackle anchoring bias, be aware of the initial info's impact and consider a broader range of data before settling on decisions.

Anchoring bias involves relying too heavily on the first piece of information encountered (the "anchor") when making decisions, even if it's irrelevant or arbitrary. This can result in skewed judgments and inaccurate estimations, as subsequent information is interpreted relative to the initial anchor rather than being evaluated objectively on its own merits.

We face this bias type frequently when dealing with the same data for long time or as a permanent data base, for example we are dealing with customer complaints and once we face issue we will by default look into the common areas of issues history. We can overcome this by following design thinking in problem solving and use some techniques ( e.g. 5 whys), to better dig deep in the problem root cause and take the right decision.

That is where neutrality should be practiced. It is not easy, but open minded approach is the best approach to consider in such a situation.

The framing effect occurs when the way information is presented influences decision-making outcomes. People tend to react differently to the same information depending on how it's framed, with preferences skewed towards options framed positively or perceived as gains, while avoiding options framed negatively or perceived as losses.

In tackling the framing effect, it's crucial to be mindful of how information is presented. I always remind myself to question assumptions embedded in the framing and explore diverse perspectives. Seeking out different viewpoints helps me gain a more comprehensive understanding. I focus on objective criteria rather than subjective cues, delaying judgment until I've thoroughly evaluated options. Educating others about the framing effect is also important to foster rational decision-making. By employing these strategies, I aim to make choices that align with my goals and values while mitigating the influence of biased framing.

The framing effect is a cognitive bias that influences how we perceive and respond to different situations based on how they are presented or framed. For example, we might be more likely to accept a medical treatment if it is described as having a 90% success rate than if it is described as having a 10% failure rate, even though the probabilities are the same. The framing effect can affect our decision-making process by making us focus on the positive or negative aspects of a choice, rather than the objective facts and consequences. To avoid the framing effect, we should try to restate the problem or the options in different ways, seek out alternative perspectives, and evaluate the evidence and logic behind each frame.

En mi opinión, el efecto de encuadre subraya la importancia del lenguaje y la presentación de la información en la toma de decisiones. Como seres humanos, somos susceptibles a ser influenciados por la forma en que se nos presenta la información, lo que puede llevarnos a tomar decisiones diferentes incluso cuando la sustancia subyacente es la misma. Reconocer este efecto nos permite ser más conscientes de cómo se nos está presentando la información y nos ayuda a tomar decisiones más informadas y objetivas al considerar diferentes perspectivas y encuadres.

The availability heuristic let’s say is like our brain being lazy and relying on what's easily accessible in our memory. In business, if we recently heard about a startup failing, we might think all startups are super risky. But, that's just the most available info. So, stay aware of the availability heuristic by paying attention to whether you're relying on easily recalled examples or recent news. If your decisions are based on what's readily available, take a step back. Challenge yourself to seek out a broader range of information. By consciously diversifying your information sources, you can sidestep the availability heuristic and make more well-rounded decisions.

This bias involves overestimating the importance or likelihood of events based on their availability in memory. Information that's readily available, recent, or emotionally salient tends to have a disproportionate influence on decision-making, leading to errors in judgment and risk assessment.

The availability heuristic is a mental shortcut where people make judgments or decisions based on how easily information comes to mind. If something is readily available in memory, it's perceived as more important or more likely to occur. Conversely, if something is less accessible or less memorable, it's perceived as less significant. In decision-making, the availability heuristic can lead to biases because the ease of recall is not necessarily correlated with the actual likelihood or importance of events.

Y por eso debes recorrer endeble camino en las decisiones, de lo emocional a lo racional primero, ya está analizado? Pues ahora de lo racional a lo emocional. Sigues queriendo hacerlo? Ahora si. Hadlo.

El exito en todo aspecto de la vida es mantenerte actualizado conforme lo que demanda cada situación. De acuerdo al ejemplo si realizas un viaje y lo puedes realizar por avion recuerda que el tiempo es lo mas valioso que se debe cuidar, los accidentes aereos son mas trascendentales pero si juzgas cuantos se producen a diario te daras cuenta que la probabilidad que se materialice es muy baja, que debes realizar selecciona adecusadamente el proveedor del vuelo. El exito se obtiene mitigando riesgos no siempre limitandote en lo que debes realizar, cuando lo tienes identificado dentro de la naturalización de cada acto. (Legal, necesario y oportuno).

"Fail fast mentality" and "sunk-cost fallacy" can be co-mingling concepts. As I lead teams, be it with respect to product iteration or adjustment of commercial go-to-market strategies, two themes often remain true, which can be helpful in evaluating sunk cost in current concepts versus the upside of investment elsewhere: 1. Is the current pursuit lucrative? This can be financial (ARR/NRR/Cashflow), human capital (resource deployment), or investment specific (is the current course contingent on driving capital required to sustain the company)? 2. What is the opportunity cost in pursuing a new course? This takes the sunk cost, calculates reward of continued action, & evaluates the outputs against the cost and upside of investment elsewhere.

In both my professional and personal experiences, the sunk cost fallacy is a daily challenge. It's about realizing that you might be pouring time, money, or effort into something that's not giving back what you expected. Admitting this and deciding to cut losses can be tough. I've noticed that it's not just a theoretical concept; it's a real-life struggle. Identifying and admitting the sunk cost is a crucial step, and I've found that the sooner I recognize it, the better. Sure, it's not easy to admit that you've invested so much and might need to change course, but for the long-term gain, it's the best call.

Como toda situación lo que hoy estes haciendo condiciona lo que obtendras en el futuro. Si tu proyecto o empleo no alcanza lo que pretendes reenfocalo o cambialo, de lo contrario seguiras obteniendo resultados mediocres por insatisfacción y falta de actitud en un lider de cambio.

The sunk cost fallacy is a cognitive bias that makes us stick to a course of action or a decision even when it is no longer beneficial, because we have invested time, money, or effort into it. We tend to ignore the opportunity cost of what we could gain by switching to a better alternative, and focus on the loss of what we have already spent. For example, suppose you are deciding whether to continue a project that is behind schedule and over budget, or to cancel it and start a new one. The sunk cost fallacy would make you reluctant to abandon the project, because you would feel that you have wasted the resources that you have already invested in it, even if the new project would be more efficient and profitable.

Like every situation, what you are doing today conditions what you will get in the future. If your project or job doesn't achieve what you desire, refocus or change it; otherwise, you will continue to obtain mediocre results due to dissatisfaction and a lack of attitude in a change leader

Overconfidence bias is the tendency to overestimate one's own abilities, knowledge, or judgment, and to be too optimistic about the outcomes of one's decisions. This can lead to taking excessive risks, ignoring relevant information, or dismissing feedback from others. For example, a manager might decide to launch a new product based on their own intuition and positive expectations, without conducting adequate market research, testing, or consulting with experts. This could result in wasting resources, losing customers, or facing legal issues. To avoid overconfidence bias, one should seek diverse perspectives, acknowledge uncertainties, and test assumptions before making a big decision.

When faced with big decisions, it’s important to know yourself to know the biases you bring to the table. Self awareness makes it possible to know your tendencies and therefore prepare to counter the bias. I bring overconfidence bias. I’m optimistic and I get excited about goals and challenges. I will often see the finish line and miss sight of the obstacles along the way. This can cause me to underestimate time, the complexity of the problem, and to be left unprepared for anything to go off course. To combat this I have to ask- what could go wrong and partake in scenario planning. I have to intentionally slow myself down!

Overconfidence bias involves overestimating one's own abilities, knowledge, or judgment, leading to excessive risk-taking and unwarranted certainty in decision-making. It can result in poor decisions and failure to adequately consider alternative perspectives or potential pitfalls, ultimately increasing the likelihood of adverse outcomes.

Overconfidence often drives us to underestimate the other sides of the question. In my opinion this is the first thing to avoid when confronted with making a decision.

Well, I think we tried very hard not to be overconfident, because when you get overconfident, that's when something snaps up and bites you.

Digital tools and artificial intelligence (AI) hold significant promise in supporting decision-making processes by providing data-driven insights and mitigating biases. For example, AI algorithms can analyze vast datasets to identify trends and patterns that human analysts might overlook, offering a more objective basis for decisions. However, it's crucial to remain vigilant about the biases that can be inherent in the data or algorithms themselves. Best practices for leveraging technology in decision-making include regularly auditing AI systems for bias, ensuring diverse data sets, and combining AI insights with human judgment to benefit from both data-driven objectivity and human nuance.

Don't fall victim to resulting bias, the tendency to judge decisions based on their outcomes rather than the quality of the decision-making process itself. Author Annie Duke argues that it's crucial to recognize resulting bias because it can lead individuals to evaluate decisions based solely on whether they resulted in success or failure, rather than considering the factors that were within their control at the time the decision was made. By understanding resulting bias, individuals can avoid attributing success solely to skill or failure solely to bad luck. Instead, they can focus on analyzing the decision-making process objectively, considering the information available at the time and the factors that influenced their choices.

We get blind on data and pay the price later for it. A company driven by only data acts like a sociopath and psychopath mixed in to one. The issue with digital tools and Ai for data driven decision making is that it takes out the human perspective more than we know. When you are testing you can miss important things that is uniquely human and soft/psychology things are not included in the evolution which kills products in the end. Tiktok is an example, driven with data and now it's backfired due to the effect on the human in the long run.

Another common bias is 'Egocentric Bias'. This means that we bring our own perspective to the table, which might be similar to others, or it might be very different. We naturally think our perspective is right and that everyone knows what we know. Getting out of our own heads to see the perspective of others is actually very hard to do. Like all biases, there are things that can help you overcome egocentric bias. One tip to being able to see another's perspective is inviting the other people to share their views (especially if they have been quiet) and genuinely listening and processing what they are saying. There are also many de-biasing techniques you can use to encourage divergent thinking.

The structure needs improvement. There are 200 biases, but only 6 main bias groups. You nailed the groups of confirmation, availability and overconfidence, while anchoring is a heuristic and framing+sunk cost are part of loss aversion. Loss aversion is the tendency to fear losses on average twice more than to want gains. What is missing is emotional and ethical bias. Ethical bias is our tendency to prefer what is right for ourselves over what is simply right. Emotional bias is tricky and not fully researched yet. 1) emotional bias is how we are affected by our mood. A good day and you approve the project. 2) our emotions also affect all our other biases negatively. 3) there are also individual emotional biases such as status quo.